Major League Soccer
Several cities vie for expansion teams as complications delay decision.Third of three parts
By Robert Wagman
(Sunday, May 16, 2005) -- Major League Soccer has said it will expand by two teams for the 2005 season. One team will be Chivas USA, playing in either Los Angeles or Chicago, or maybe somewhere else. Cleveland was announced as the second , but things have changed. The Cleveland bid is hanging by a thread, while Seattle may be emerging as a real possibility.
Here's a look at the cities being considered for expansion.
Cleveland is not ready to field a team in 2005 with developer Bert Wolstein, who has led the drive, saying the possibility of bringing an MLS team to Northeast Ohio in the next few years is perhaps "50-50."
There has not been a Bridgeview in Cleveland or northeastern Ohio. Bridgeview is the Chicago-area community that was willing to put up $60 million or so in bond financing to help build a new soccer-specific stadium for the Chicago Fire.
During the MLS Cup weekend last November, commissioner Don Garber announced that Wolstein had signed a letter of intent to become "our third new investor in Major League Soccer in the last four months." Garber further announced Wolstein's commitment to build a soccer stadium in Cleveland and thus would most likely become the second MLS expansion team in the 2005 season along with Chivas USA, a franchise belonging to Mexican power Chivas of Guadalajara.
(Ray Kroenke, who assumed the ownership and operation of the Colorado Rapids, reducing the Anschutz Sports stable to five teams, was the first investor Garber referred to.)
What Garber didn't say was that while Wolstein, and his partner Paul Garofolo, who together have run the Cleveland Force indoor and outdoor teams for 25 years, were "committed" to building a stadium, that commitment was dependent on public financing of about $ 90 million. Wolstein is willing to put up about $20 million of his own money.
Wolstein looked at the Cleveland skyline and saw the baseball's Indians, football's Browns and basketball's Cavaliers playing in stadiums fully or partially funded by the city and county, so it was not altogether unreasonable to expect that the public sector would step up to bring a soccer franchise to the area.
"I need help. I can't do it by myself," Wolstein told the local media. "For this to work, a downtown location is key. We need people using hotels, restaurants and cabs."
Wolstein's initial plan was for the majority of the public share of funds to be produced from an increase in the county real estate conveyance tax -- the one-time fee that is paid when a home or other real estate is sold. That would require state legislation and would be opposed by the Ohio's real estate industry.
Wolstein talked to officials from Cleveland and Cuyahoga County, to suburban communities where he had options on parcels of land, to cities as far away as Akron. His vision was of an MLS stadium anchoring a major mixed-use development or a major urban renewal effort, but he has come up empty to this point.
Wolstein investigated using Cleveland Browns Stadium, but came to the conclusion that using a 73,000-seat stadium was not feasible and a facility with a capacity of around 25,000 was needed for the franchise to be profitable.
"It shouldn't even be discussed," Wolstein told the Cleveland Plain Dealer. "You can't play this game in a 75,000-seat stadium, and you can't play in a stadium you don't own. You need the revenues. You'd lose a fortune with the team. The only way to get it back is with ancillary revenues such as parking, signage, food and beverages."
In January, Wolstein tried to spur city and county officials by issuing a 60-day ultimatum, saying he needed to start the new operation by March, but received no response.
Wolstein recently told the Plain Dealer that it is now unrealistic to believe he could field a team for 2005, but three or four years down the road, things might change. "Things move so slowly around here," Wolstein said. "I'm going to let what's simmering simmer until the league calls me up and says, 'If you can't do it, you can't do it, we'll take the franchise back.' "
Right now, it appears Wolstein's best bet is the northern Summit County. The county director of community and economic development Joe Migliorini speculated that the county might be interested in financing a soccer stadium using tax increment financing under which property taxes would be forgiven. However, Migliorini told the Plain Dealer that the county can do nothing specific until Wolstein acquired land for the stadium.
Wolstein said he needs at least 100 acres for a stadium, more if it is to be part of a major development and, while he is looking, he has yet to locate a suitable plot.
[Note: Wolstein, 77, died on Monday, May 17.]
Since MLS was formed, the league always thought it should have a team in Seattle. The problems have been finding a local ownership group and a place to play. For years, MLS arduously courted Microsoft co-founder Paul G. Allen, who owns the National Football League's Seattle Seahawks, but Allen so far just doesn't seem to want to get involved in soccer. MLS's single-entity structure might be a major objection of Allen.
In 2003, MLS chief operating officer Mark Abbott, the point man on expansion, started working with the A-League Seattle Sounders general manager Adrian Hanauer in an attempt to get a bid off the ground. At the time, Hanauer and his partners said they were not really interested in becoming MLS owners, unless the plan included building a new soccer stadium, possibly at the site of the old Midway Landfill. The site was being studied by the Sounders for a $20-25 million for a 7,000-seat stadium, expandable to MLS requirements with an indoor\outdoor training complex.
Now things have changed. Hanauer no longer believes that a soccer-specific stadium is central to a successful MLS franchise and that Seahawks Stadium might do fine, in part because it would bring the Seahawks ownership group back into the picture.
"I'm actively trying to figure out a way to bring Major League Soccer to Seattle," Hanauer recently told the Tacoma News Tribune. "It will be a fantastic market for Major League Soccer. I believe Major League Soccer will be here some day soon. MLS wants to be here." "(The Seahawks) would like to see (Seahawks Stadium) used for Major League Soccer," Hanauer continued. "The challenge is that it's still a difficult business model and we need to assemble an ownership group. The Sounders' ownership group is certainly interested in being partial owners of an MLS franchise -- whether that is a quarter, a third, a half -- and we need to find other partners. I'm actively out there looking for those partners. That really is the one major barrier to bringing an MLS franchise here. We have the facility, we have the infrastructure to run the franchise, and we have the fans." Hanauer says he now believes that Seattle could be ready as early as next season, if an aggressive ownership group can be assembled. "At that point, it won't take long," he said. "It's not like five years later we would have a team. If we could put an ownership group together in the next 60 days, we could have a team in 2005. That's when MLS would love for us to be here, in 2005."
To hear many fans in the region talk about it, Rochester has everything in place for the local A-League franchise, the Rochester Rhinos, to move up to MLS as its next expansion franchise. Rochester, they say, meets MLS's three criteria -- an active ownership group, a new soccer stadium under construction and an established fan base.
Rochester's bid, however, might be less than meets the eye.
Rhinos owner Frank DuRoss clearly wants to get into MLS, but he has issue with the $10 million expansion fee. "We are not going to comment on any of the financial arrangements being discussed," is all DuRoss will say publicly about the fee. He has quietly told a number of people, however, that he hopes that the expansion fee can be reduced and paid over a long period, or eliminated altogether. MLS has not indicated that this is a possibility.
Furthermore, DuRoss is concerned about MLS's single-entity structure. He believes that a nucleus of the present Rhinos team must retained to maintain fan interest and that he is not comfortable with those players' contracts becoming the property of MLS. Moreover, a number of Rhinos have lucrative deals to play indoors in the winter, something that MLS forbids its players to do.
Then there is the new stadium, to be called PAETEC Park for the local communications company that paid for the naming rights. When the stadium was first announced, it was to be a $50 million, 20,000-seat stadium expandable to 27,000 seats, to be paid for in part by a 12-year, $23-million naming agreement. But PacTec chairman Arunas A. Chesonis, with his company facing a slowing market, threatened to cancel the deal before agreeing to paying $2.1 million over seven years.
The stadium, in turn, has been substantially downsized. It's now to be built in three phases, starting with 12,500 seats and 4,000 in removable bleachers. If all three phases are built, the stadium could grow to a maximum of only 20,000 seats.
What is likely not at issue is the fan base. The Rhinos are one of the best supported A-League teams and selling 7,500 season tickets, MLS's benchmark, is within reason.
DuRoss continues to wait MLS out, probably hoping the league becomes desperate for viable expansion options and will come to him on his terms. Only time will tell if he is right.
The two cities in Oklahoma, in-state rivals, have both indicated a desire to host an expansion franchise. The University of Central Oklahoma in Edmond, just north of Oklahoma City, has begun work on what will eventually be a 20,000-plus-seat soccer stadium with 6,500 parking spaces. To built in phases, when completed, the facility would the necessary infrastructure to support a MLS team -- lockerrooms, training facilities, luxury boxes, press box, etc.
"Our university, its student body and the entire community are very bullish about bringing an MLS expansion team to our campus," Central Oklahoma vice president Steven Kreidler recently told local media.
One major problem is the absence, thus far, of a group with the finances to back a team. The university said it is trying to put together a local investor group, but no one has been identified yet.
Then there are questions about the depth of fan support in a small market, such as Oklahoma City, even though Tulsa was a reasonably successful franchise in the old North American Soccer League. In April, an MLS exhibition in Oklahoma City between the Dallas Burn and Kansas City Wizards drew about 6,500.
If an aggressive ownership group emerges in Oklahoma City, and if MLS decides to go into secondary markets, the community is possibly a viable contender for expansion beyond 2005.
San Antonio, Tex.
Mayor Ed Garza is actively seeking to bring a team to San Antonio, which has a dandy stadium in the Alamodome and would seem to have a fan base that can support a professional soccer team. Garza, however, has not been able to find a potential ownership group with sufficient resources.
Garza talked with Chivas about basing its MLS club in San Antonio. He has contacted MLS about an expansion team and been I touch with Javier Perez Teuffer, president of Mexico's vaunted Club America, about moving to San Antonio should he acquire the San Jose Earthquakes from Anschutz.
Garza scored a major triumph of sorts when he got the small country of Dominica to agree to hold its upcoming World Cup qualifier against Mexico in the Alamodome on June 19. He hopes a packed house will convince potential investors that San Antonio is a viable option for a team.
One of the more intriguing possibilities for MLS expansion is Toronto after the Canadian Soccer Association has tried unsuccessfully for years to get a first-division league started north of the border.
In the meantime, the CSA is going forward with plans to build a 30,000-seat national soccer stadium in Toronto. The stadium is expected to cost $75 million with the CSA making pitches to national, provincial and city governments for funding.
In the old NASL, some of the best franchises were in Canada. World governing body FIFA prefers professional leagues be contained within a single country and the NASL was required to get a special exemption the CSA and the United States Soccer Federation would be required to apply together for a waiver. .
USSF president Bob Contiguglia, told SoccerTimes the Federation would likely support asking for the exemption "if the circumstances are right."
CSA chief operating officer Kevan Pipe said his organization has identified an investor willing to put together a group to put up the $10-million expansion fee.
"Landing an MLS franchise is critical to the long term success of our stadium," Pipe told the Toronto Globe and Mail. But a franchise in Canada would require MLS to modify its rules that classify Canadians as "foreign," among other bylaw adjustments.
Robert Wagman is a SoccerTimes senior correspondent. E-mail Robert Wagman.
Robert Wagman is a SoccerTimes senior correspondent. E-mail Robert Wagman.